How To Do An In-House Marketing and Advertising Assessment of Your Small Business
by Tom Egelhoff
One of the primary reasons for small business failure is the lack of assessment of the business by the owner(s) on some kind of a regular basis.
They tend to look at where they are today and not where they will be five, ten or even fifteen years from now.
One of the largest expenses of any business can be advertising and/or marketing.
If you aren't sure which is which, my business card is advertising...deciding who gets my business card is marketing.
Is Marketing An Expense Or An Investment?
If I'm giving my business card to the wrong target market, then my advertising and marketing efforts are an expense, not an investment.
My advertising and marketing should make money — not cost money. So how do I know if what I'm doing is working? How do I know where to spend my money?
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Those Who Ignore The Past Are Destined To Repeat It
Remember those famous words? In business, these words mean that if you don't learn from past mistakes you will continue to repeat them.
You can't continue to spend money on non-productive forms of advertising or marketing.
I could walk into almost any business and the owner would have no problem telling me their best selling products.
They could show me exact figures of cost of goods sold, inventory control and profits per unit.
Yet if I asked for the same type of information about their advertising, they give me a look like a deer caught in headlights.
If you've been in business for a number of years you have some kind of track record to build on. If you're a new business then start your record keeping now. See the next segment to find out how ...
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Assessing What Works And What Doesn't
Start by making a list of all your advertising and marketing efforts for the past year and what they produced for your business.
Then do the same for the past three years and compare them. Chances are you are doing the same things over and over again with no thought to assessing what is working or not working.
For example, let's say you printed promotional fliers last year. Those fliers produced 10 customers who spent $750.00 in your business. The income per customer this method produced is $75.00.
Continue on doing the same for your social media ads, radio, TV, brochures, direct mail, trade shows, billboards, newspapers, newspaper articles, web site and any others I've left off.
How many customers did each method produce and what is the income per customer?
Using this method you should be able to quickly tell which forms of advertising, promotions or marketing are producing the most profitable results.
Stop doing the methods that are not producing strong business revenue.
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Show Me The Money!!
If you're going to tell me you don't know what each of these are producing for your business, or you're not keeping these kinds of records, then you definitely need this article.
If you're putting any money into any advertising and you do not know the customer income that advertising is generating for your business, it's just a matter of time until you are going to be in serious trouble.
Sooner or later a competitor who knows and understands this method is going to come along and slowly steal your customer base. How?
Their message is going to be in the right place at the right time at the lowest possible cost, while your message is somewhere else.
They will not be wasting money putting their message in the wrong place. The money they save will go toward better products, employees, customer service and bigger ads.
I don't care if you're an established business of 25 years or more. You could be gone in a year or less.
Companies fail for a variety of reasons but most common is lack of knowledge and poor assessment of available knowledge.
Let me ask you this question. Is there at least one long established business in your town that has gone out-of-business in the last year?
We've had several here in Montana... and I'll bet there's some where you are. With computers and improved business software the informed business owner is a force to be reckoned with.
The good news is, if you are using this method correctly and your competitor isn't, they could be the one gone in a year or less.
Something to think about isn't it?
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© Eagle Marketing PO Box 271, Bozeman, MT 59771-0271
http://www.smalltownmarketing.com - (406) 585-0219
Based in Bozeman, MT, Tom Egelhoff is the author of How To Market, Advertise & Promote Your Business Or Service In A Small Town, and The Small Town Advertising Handbook: How To Say More And Spend Less. He is also a seminar and workshop presenter and trainer. He may be reached at 406-585-0219 or PO Box 271, Bozeman, MT 59771-0271
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